More than 400 pubs closed this year and those left standing face growing pressures caused by the Budget

More than 400 pubs across England and Wales were demolished or converted to another use over the last year, fresh figures show.

Government data analysed by commercial real estate specialist Altus Group shows the number of pubs across the country falling below 39,000 for the first time.

It comes amid increasing fears for the future of Britain’s hospitality sector, which is weathering subdued consumer sentiment, high staffing costs and the looming impact of Autumn Budget tax hikes from April next year.

Altus said 412 pubs called last orders for the final time over the year to December at a rate of more than 34 a month.

The capital was the worst affected, with London losing 55 locals, while the number of West Midlands pubs fell by 53 to 3,904.

It was the sharpest fall in pub numbers since 2021, when the sector was hit hard by pandemic restrictions and surging energy prices.

UK pub numbers have now plunged by more than 2,000 since the start of 2020.

Hospitality firms and trade bodies have warned that the Labour Government’s Budget could lead to more job cuts and venues closing.

Chancellor Rachel Reeves announced in October that the rebate enjoyed by hospitality operators on their business rates bills would be reduced from 75 per cent to 40 per cent, with discounts capped at £110,000 per firm.

Employers will also pay a 15 per cent National Insurance rate on staff salaries above £5,000, rather than the current 13.8 per cent levy on wages exceeding £9,100.

And the National Living Wage will go up by 6.7 per cent to £12.21 per hour, while the minimum wage for 18 to 20-year-olds will soar by 16.3 per cent to £10 per hour.

Since these measures were unveiled, pub chains including JD Wetherspoon, Fuller’s and Young’s have warned of multi-million-pound cost impacts.

Altus Group’s Alex Probyn said: ‘Many publicans that I speak to are extremely worried that this could be their last Christmas given the combination of hiking the amount employers will have to pay in National Insurance, increases to the minimum wage and the business rates discount being slashed from 75 to 40 per cent in 2025.

‘Many pubs simply will no longer be viable making plots even more attractive for alternative investment.’

Emma McClarkin, chief executive of the British Beer and Pub Association, added: ‘Brewers and pubs pour billions into the economy and support more than a million jobs, so we know that closures can have a disastrous impact for both the nation’s coffers and the job market.

‘For the sector to remain a stalwart of the economy and continue to be the beating heart of our communities, the Government must swiftly deliver permanent and meaningful business rate reforms.

‘We stand ready to help the Government bring in sorely-needed change that will break down the barriers that stop our sector from contributing even more to the economy and employing more people than ever before.’

DIY INVESTING PLATFORMS

AJ Bell

AJ Bell

Easy investing and ready-made portfolios

Hargreaves Lansdown

Hargreaves Lansdown

Free fund dealing and investment ideas

interactive investor

interactive investor

Flat-fee investing from £4.99 per month

Saxo

Saxo

Get £200 back in trading fees

Trading 212

Trading 212

Free dealing and no account fee

Affiliate links: If you take out a product This is Money may earn a commission. These deals are chosen by our editorial team, as we think they are worth highlighting. This does not affect our editorial independence.

Compare the best investing account for you